Understanding What Wealth Means

finances financial financial freedom wealth wealth building Sep 28, 2021
Dr. Tim, his wife Pam, assistant Tracy and fellow Gladiator Scott Davis boating in South Africa.

In order to discuss what wealth means, we need to get clear on what it means to each person. When I give my live seminars on the subject, I ask the audience, “How many in here would like financial freedom?”  Almost, without exception, the entire audience raises their hands, and those who don’t will lie to you about other things as well. Then, I ask this question: “OK, what does financial freedom mean?” Suddenly, a quiet comes over the crowd and nobody really seems to have an answer.

Now, I’ve done this multiple times across the country, and after a while some people will start raising their hand and they’ll say something like, “I’d like to have $1 million,” “I’d like to be able to never work,” “I’d like to be able to buy whatever I want,” “I would like to have my debts paid off,” “I’d like to be able to put my kids through school,” “I’d like to have a nice retirement,” and the list goes on… It becomes very obvious there is no one definition of financial freedom.  No one seems to agree on what the definition should be, and everyone seems to have their own. The problem I notice is most people’s definition of financial freedom is so vague, or they haven’t thought about it all, that it’s impossible to create their goal and accomplish it.

Anyone who has read anything I’ve written over the years realizes it’s hard to accomplish a goal that’s not specific and time oriented. And yet, most people say they want financial freedom, but they haven’t been very specific about what that means to them, and they certainly haven’t given it any time frame. So, the first step we need to do is define what we consider to be financial freedom and create a plan with a time frame to accomplish it.

For me, the most important thing in life is time. I can always get more money, I can always get more friends, but what I can’t get is more time. We each have 24 hours in a day. The great thing is, we get to choose what we do with those 24 hours, and what we choose to do makes all the difference. The problem is, we don’t know how many of those 24-hour periods we will be given.

Since time is the most important thing, I’ve decided to define wealth based on time. To me, financial freedom is the amount of time I could go without my active income and still survive. For example, if you were to lose your primary source of income how long could you survive? How long could you support your family and pay your bills if you were not able to go to work? The answer to that question is how financially free you are. If you could last one week without your primary income, then you’re one week financially free. If you could last one month, then you’re one month financially free. If you could last one year, then you’re one year financially free.  Does that make sense? The goal is to create financial freedom so that if you lost your primary income, you would be able to live off the resources of your own efforts indefinitely

So, your homework from this part of my financial series is to take a look at how much you spend annually (or monthly, preferably) and see what your monthly expenses are.  Don’t include everything you spend money on but include your monthly living expenses. If you had to live frugally, but not like a pauper, what would your monthly expenses be? These monthly expenses should include:

  • Housing (which would include your house payment or apartment rent, renter or homeowner’s insurance, and your monthly living expenses to live in your house or apartment)
  • Transportation costs (your car payment, insurance, and gas—or Subway ticket if you live in the city)
  • Clothing costs (sometimes you need to figure out how much you’re spending on your clothing and divide that number by 12)
  • Basic entertainment (like going to the movies, paying for Netflix, your phone bill, and those sorts of things, but not extravagant entertainment like going to the Super Bowl)
  • Healthcare or health insurance (like your monthly bills or prescriptions)

When you’re done you should have a list that lists the amount of money you spend on each of those things and anything else you have monthly payments for. So far so good?  Now, total your monthly expenses. You can alter this list based on your lifestyle, but you need to get to the idea that if you lost your primary income and had to survive, these are the basic monthly expenses you need to pay every month without being extravagant.

As we go forward, this number will become your new goal. Your new goal will be answering the question, “How do I get to this number every month without using my primary source of income?” To be clear, the goal is not, and I repeat, not to quit your job. That’s a different book, and that’s a stupid book! You will never want to lose your primary source of income… that’s why it’s called primary. The goal here is to have the resources available, should you lose your primary source of income, you will be able to survive.

Additionally, if you’re able to live off your own resources then your primary income, which will always be your biggest source of income, becomes an opportunity to make investments, do other things, or to create a spectacular lifestyle! Many people say if they had an alternate source of revenue that paid their monthly bills, they would quit their job. I think that’s why the good Lord doesn’t allow most people to do it.  The people I know who have actually reached that area of financial freedom work harder at their job than they ever have. 

This is my plea to you:  Don’t just read this article and do nothing about it. Go create your list of financial abundance so we can get on to the next steps.  Get your pen and paper and let’s get to it!

Living Every Minute,
Dr. Tim

Share This Blog Post


- OR -

Create Spectacular In Every Area of Your Life

Find the solutions that will improve your health, wealth & relationships.

View Our Products

Stay connected with news and updates!

Join our mailing list to receive the latest news and updates from our team.
Don't worry, your information will not be shared.

We hate SPAM. We will never sell your information, for any reason.